Jan 5, 2016 5 min read

The president of the American Petroleum Institute said Tuesday the United States – already a world leader in energy production – could create even more jobs and cheaper energy prices if the right policy choices are made.

Jack Gerard, whose trade organization represents all facets of the oil and gas industry, was keynote speaker for API’s sixth annual “State of American Energy.”

“The United States begins this new year leading the world in energy production, economic growth and lowering our greenhouse gas emissions, a trifecta unmatched by any other country today,” Gerard told attendees at a luncheon in Washington, D.C., an event that was also webcast to reporters around the country.

“The gains we’ve made and our ability to sustain them in the years to come are largely dependent on the energy policies we pursue.”

According to Gerard, the policies that should be followed with regard to energy should adhere to what he referred to as “the U.S. model,” which includes lower costs for American consumers, a cleaner environment and American energy leadership.

The lower costs, Gerard noted, have been documented.

He said the Energy Information Administration found that consumers saved an average $700 on transportation fuel costs alone last year because of abundant energy, while energy industry consultant IHS said average U.S. household income was $1,200 higher in 2012 given lower fuel costs from unconventional development.

Despite the downturn in energy production because of a glut both in oil and gas here and around the world, Gerard sees a bright future for the industry his group represents.

“And even during this period of realignment, the oil and natural gas industry remains an important source of well-paying jobs for millions of American families,” Gerard said. “America’s oil and natural gas industry supports approximately $1.2 trillion in U.S. gross domestic product.”

On the environmental front, Gerard cited recent U.S. Environmental Protection Agency data that found that in 2013 greenhouse-gas emissions were 9 percent below 2005 levels, even as population, energy use and gross domestic product have increased – “proof that the U.S. model is the most effective way to better protect the environment, while growing the economy and increasing energy production.” He added that the industry has invested $90 billion in zero- and low-carbon emitting technologies from 2000 through 2014 “almost as much as the federal government’s investment of $110.3 billion.”

But Gerard cautioned that without policies that support responsible energy development, the economic benefits could begin to be reversed.

He noted that a Wood Mackenzie study conducted last year found that with the right energy policy America’s oil and natural gas industry could support as many as an additional 1 million American jobs in 2025 and as many as 2.3 million by 2035.

The study also projected that pro-development energy policies could cumulatively increase local, state and federal government revenue by more than $1 trillion and boost household discretionary in come by as much as $508 billion, while lowering average annual household energy expenses by $360 per year.

Conversely, the study found that national energy policies that discourage energy development and constrain U.S. refiners could lead to a cumulative decrease of $500 billion in government revenue from 2016 to 2035 and increase the cost of energy by $242 annually for the average household.

“Encouragingly, there is a growing support within Congress for U.S. model-style energy policies,” Gerard said, noting that Congress last month lifted the 40-year ban on crude oil exports, a move he said could save consumers as much as $5.8 billion a year in fuel costs.

Gerard called for amending the country’s Renewable Fuel Standard, stating that there “is very little consumer demand for high ethanol fuels. According tot he EIA, the annual amount of E85 sold in 2014 is less than 1 percent of annual gasoline demand.”

He was also critical of the EPA’s Clean Power Plan, “which under the guise of environmental protection, does in fact, seek to pick winners and losers in the energy market, not based on market conditions, consumer preference or economic reality.

“As the president’s last full year in office begins, we hope that he will take note of and help foster the U.S. model,” Gerard said, adding he believes energy will be among “our most pressing national issues.”

“And while the outcome of November’s elections is far from clear, it is certain that no matter who becomes the 45th president of the United States, he or she will lead a nation that is first in oil and natural gas production, first in refining ever-cleaner fuel and first in reducing greenhouse gas emissions.”

During a brief question and answer session, Gerard was asked how to best support those communities that have been adversely affected by the downturn in energy.

He reiterated his earlier comments on a pro-development stand that “ask for the opportunity to operate on a global scale. Let us compete and produce jobs.”